Justifying the Chief Customer Officer in the C-Suite | CustomerGauge Justifying the Chief Customer Officer in the C-Suite

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Justifying the Chief Customer Officer in the C-Suite

20 years ago words like “support”, “service”, and “manager” dominated customer operation titles. During this time, the long term value of an existing customer within a business was largely an afterthought. Prospects can now easily compare product features and develop brand notions through social media and other online avenues. This trend has made a strong commercial relationship with a customer more valuable. Also, in the economic downturn of 2008, many businesses grew to appreciate and understand the critical importance of organic growth within an existing customer base. While titles such as “support” and “service” still exist and are important to a company’s success, a new business strategy centered around customer relationships has emerged over the past few years.

Say hello to the newest member of the C-Suite: the Chief Customer Officer. 10% of Fortune 500 companies and 22% of Fortune 100 companies now include the role in their business. Over the past 3-4 years, the Chief Customer Officer has not only become a customer advocate, but brought the conversation about customer importance to the board level. In the U.K, the number of Chief Customer Officers across all industries has risen from 14 in 2014 to 90 in 2017, and half of those roles were created in the last 15 months.

With this trend, the C-Suite is now more crowded, alongside other roles like the Chief Culture Officer and Chief Experience Officer. Adding another C-Level executive is a topic of contention. All too often boards create another role to superficially solve a perceived problem. Moreover, many executives agree with the notion of a Chief Customer Officer, but don’t actually implement one. So, is the Chief Customer Officer worth it? And, moreover, what does a Chief Customer Officer even do? That’s what we're here to find out.

Defining the Role of a Chief Customer Officer

The Chief Customer Officer takes full responsibility for all things related to the customer. Ideally, the Chief Customer Officer is a tenured executive who drives a consistent customer-centered culture across the entire company. The responsibility of both a customer-centric culture and revenue growth opportunities with existing customers used to spread across multiple executives. Now, the Chief Customer Officer takes full ownership of these realms through leveraged physical and digital communication channels.

The Chief Customer Officer is a customer advocate. They strive to know everything about their customers and innovate on that knowledge through data-driven processes. They care about customer service excellence and above all are responsible for understanding the end game a good customer experience can provide. In this way, they work with multiple departments ranging from sales to marketing to the product. It is also the role of a Chief Customer Officer to prove to the C-Suite the financial benefits of investing in the customer experience.

So, what’s the difference between the Chief Customer Officer and the VP of Customer Success? Well, the words “Customer Success” or “Customer First” often signify a platform or company function. The VP of this realm is mostly in charge of the success of the product in a customer’s hands, but is not in charge of a revenue line item. The Chief Customer Officer can influence product development by gathering feedback from successful customers and the VP of Customer Success is more focused on the status quo. In SaaS businesses, the Chief Customer Officer has emerged in association with other themes like loyalty and retention. These often fall outside of the VP of Customer Success’ realm of responsibility.

The Chief Customer Officer understands the DNA of what makes a customer tick, the entire lifecycle of the customer, and what metrics actually matter to understand these components.

Proving the ROI of the Chief Customer Officer to the C-Suite

Where does the Chief Customer Officer actually add value to the business? While the answer is more complex than meets the eye, there are two places to start looking.  

The Customer-Centric Culture

The primary objective of the Chief Customer Officer is to make the customer relationship more valuable. To drive that value they need to unify how all employees view customers. A mature customer-centric culture lives and breathes 24/7 and requires a deliberate leader who can standardize the approach.  Here’s why a customer-centric culture drives value at the executive level.

A customer-centric culture fully embraced in a company’s product department is crucial to improving product quality. The C should push product teams to gather extensive feedback from the existing customer base and leverage it to their benefit. With this data, development teams make more efficient changes and improvements and keep from guessing about what the customer wants.

Chris Jo, the General Manager of Global Services for Samsung employs customer interactions in a number of different ways. He says “it’s not just one-way; we strive for two-way communication so we make sure that we really understand what our customers want.” Often product teams used to have “customer visit days” which occur roughly once per year, but the Chief Customer Officer is in charge of making these interactions consistent, daily, if not hourly, to drive a culture that shapes a higher quality product.

A customer-centric culture is also important in marketing. For example, a Chief Customer Officer will push customer success stories publicly so the customer feels cared for. This also sends a message to future prospects that the business cares deeply about the success of their clients and might be someone to partner with.

The Chief Customer Officer also bridges the gap between what the C-Suite wants and what operationally happens at the front line in all parts of the company. According to Jose Vergara, the Chief Customer Officer at McKesson, the Chief Customer Officer is responsible for designing an experience in a way that is repeatable. In a recent interview, he discusses how Disney does this. At Disney World, every interaction both physical and emotional is thought out many times over. They make the experience designable and repeatable. To replicate this they have designed playbooks for each employee so there are no questions about protocol. Designing these playbooks requires capturing customer feedback so that the company knows what they are expecting in the future. This creates a pathway for an organization internally and drives brand value as they hone in on what the customer is looking for.

All of this raises the question: when should a Chief Customer Officer establish a framework for such a culture? The short answer: as soon as possible. As a company grows and workload across employees increase, a strong customer-centered culture erodes. Years pass and the enthusiastic founder who feels personal ownership over his customers starts to become more and more distant through added responsibilities. The earlier a company implements the Chief Customer Officer, the easier the customer-centric culture becomes ingrained.

However, hope is not lost for older companies interested in developing this new business strategy. The Chief Customer Officer can also successfully materialize as a change agent. For example, Kevin Thompson, the Vice President of Customer Experience and Development at Barneys New York broke the task of developing a customer-centric culture into 5 separate working groups across the company's different divisions. The different working groups were comprised of people from across all divisions with different points of view, drawing from merchant-teams, e-commerce teams, marketing, and other operating areas. Building each team changed the ownership and embedded the importance of cross-silo collaboration within the company.

In a nutshell, the customer centric culture that a Chief Customer Officer implements provides a launchpad for their main responsibility, a portion of the companies annual revenue.

Revenue—Retention and Internal Growth

The true value of the Chief Customer Officer does not come from creating smiley faces, but rather from generating revenue, accelerating revenue, and gaining operational efficiency within the existing customer base. In this way, the Chief Customer Officer is responsible for a sizable portion of a company's top line, which comes from two sources:

  • Retention
    Sustainable recurring revenue from existing customers

  • Internal growth
    Tapping into the current customer base to grow businesses through up-sells, cross-sells and referral marketing

The Chief Customer Officer is responsible for maintaining customer retention and the revenue those customers provide. In an EY survey in 2016, 73% of Chief Customer Officers were confident that using customer feedback helped “develop the business”. More importantly, customer feedback is used to retain business already acquired. The Chief Customer Officer’s confidence using data is much higher than the Chief Marketing Officer or Chief Security Officers. In the study, only 58% of Chief Marketing Officers and 685 of Chief Security officers reportedly felt confident using data. Chief Customer Officers often encourage technologies that allow for automation and utilization of customer feedback follow up. A great example of this is the Net Promoter methodology.

In any healthy growing company, half or more than half of revenue comes from existing customers. In this day and age, all products are shifting towards further commoditization. This has caused a marketing shift to the value of the product revolving more around the relationship with the company.

Internal growth is the other top line growth area for the Chief Customer Officer. More often, we see that the function of the Chief Customer Officer owns some sales funnel responsibility. In some SaaS companies, the Chief Customer Officer is responsible for a separate portion of the sales pipeline, including up-sells, cross-sells and referral business. Near the middle of the funnel, there are CSQL (Customer Success Qualified Lead) or a CSQA (Customer Success Qualified Advocate). These lead types are forecasted every quarter and build up a revenue line that stems from existing customers.


Marketing thought leader, Theodore Leavitt, once said that “Customers don’t want a quarter inch drill bit, they want a quarter inch hole.” In the context of the CCO, this quote is especially relevant. The CCO owns everything in the mind of the customer and are responsible for understanding what it takes to keep them, getting the most out of the relationships already established. They own retention and the revenue growth opportunities within accounts both in the B2B and B2C world. As common perspectives on the value customer relationships becomes more mainstream, so will the pivotal role of the CCO.

Next Up: The Hidden Churn Indicator - Absence of Signal

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